Regional Inequality in Tunisia : Is it a Geographic Misallocation or Spatial Nature Effects?

Using detailed household-expenditure level data from Tunisia, we examines urban-rural inequality in Tunisia. We use Bayesian regression-based decomposition method to dissect the gap between the two areas. Results of the present study suggest that the difference between rural poor households and urban poor households is due essentially to characteristic effects; while for wealthier households both characteristic and returns to these characteristic effects (for example, efficiency of educational system) are in charge of this gap. Additionally, the results demonstrate that this is an issue of value, and, more specifically, an economic development fairness conflict. It is suggested that policy makers should address a positive discrimination programs in favor of marginalized region